The Government contributed around €560,000 to support ex-IRA prisoners through an organisation that failed to comply with company law.
The cash was part of a €1.5m grant given to Coiste Na N-Iarchimi, which translates as "committee of ex-prisoners", a UK-registered company based in Belfast that was struck off in 2011 after two official warnings over failing to file accounts and returns for four years.
An EU cross-border body set up by the Irish and British Governments awarded €1.5m as part of a project aimed at helping to integrate former Republican prisoners back into society. The Department of the Environment contributed around €560,000 but was able to claim back just over half of this from the EU's Regional Development Fund.
One of the company's two directors when it was dissolved was Sinn Fein's Caral Ni Chuilin, who is the North's Culture minister. She was convicted as an IRA terrorist, and jailed in 1989 on explosive charges.
From August 31, 2008, Coiste was in breach of company law for its failure to file accounts.
It missed a 10-month deadline to submit its accounts for the financial year to October 31, 2007.
Coiste continued to breach company law for four years by failing to file accounts until December 2011. But when questions were raised about this by the Exaro investigative journal, the company was reinstated, accounts were belatedly filed and Ni Chuilin resigned as a director.
A Sinn Fein spokesman said that she “has stepped down from this role due to time pressures.”
The Department of Environment declined to comment.